International Business Indicator: Global business optimism higher than everRead Article

2017 International Business Indicator report

Global business optimism surges amid trade uncertainty

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U.S. companies are optimistic about international business and emerging market opportunities in the year ahead despite trade uncertainty, our 2017 International Business Indicator survey shows. With a score of 74 — a nine point increase from 2016 — the International Business Indicator metric of global business sentiments is the highest it has been since we began the annual business survey four years ago.

Citing a number of macroeconomic factors including a strong U.S. dollar, 81% of U.S. companies expect a rise in their international business activity in 2017. However, 78% are concerned about the effects of failed trade pacts, such as the Trans-Pacific Partnership (TPP).

View the materials below to learn more about U.S. companies’ expectations and strategies for 2017, including:

Attitudes toward trade and concerns about failed trade pacts

Future growth hot spots

Value of U.K. and European business connections in light of Brexit

External factors and events shaping international business strategies

Key highlights from the 2017 International Business Indicator report

Optimism score

Business optimism surges

With a score of 74 — a nine-point increase from 2016 — the International Business Indicator shows U.S. companies anticipate business growth due to optimism about an improving global economy and emerging market opportunities.

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International Business Indicator report

to learn why

81% indicate the international component of their business is important and expect it to increase in activity during the next 12 months

Positive macroeconomic factors

The majority of respondents expect a rise in their international business activity, citing a number of macroeconomic factors, including a strong U.S. dollar.

Learn more in the full

International Business Indicator report

The top 3 factorsdriving optimism in global expansion as perceived by U.S. business leaders . . .

97%A strong U.S. dollar

91%U.S. economic conditions

91%U.S. regulatory environment

Factors affecting international business plans

A strong dollar, U.S. economic conditions, and the regulatory environment are key for revenue growth, with currency being a major consideration in any cross-border transaction.

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International Business Indicator report

86% agree the failure of trade pacts will have a somewhat or great effect on international business

Concern about trade pacts

While business leaders didn’t think the new U.S. political administration would change U.S. trade policy, they are concerned about growing negative attitudes toward trade pacts.

Find out how geopolitical issues may hurt international business plans in the full

International Business Indicator report

68%

consider U.K. and European-based relationships moderately or very important

32%

of those indicate Brexit will have a somewhat to great effect on their company’s short and longer-term business

Wait and see with Brexit

U.S. companies value U.K. and European business relationships, but most don’t think Brexit will affect their business in those countries. Brexit-related worries include more regulation, less favorable taxes, and protectionist trade policies.

Find out how much U.S. companies value U.K. and European business relationships in the full

International Business Indicator report

The top 3 marketsimportant to U.S. business are China, Canada, and Mexico

Future growth hot spots

Survey respondents (41%) ranked both China and Canada in their top three choices for future growth. Mexico (32% of total mentions) was the third-most mentioned hotspot.

Discover other top growth markets for U.S. companies doing business abroad in our full

International Business Indicator infographics

Indicator key findings

Get a quick summary of the 2017 International Business Indicator survey findings in this two-page report.Get Key Findings (PDF)

About the 2017 survey

Wells Fargo designed the International Business Indicator metric to help business leaders better understand and assess the global business climate. Based on a survey released annually since 2014, the International Business Indicator metric tracks the strength and direction of U.S. companies’ international business outlook and activities over time. The Indicator score ranges from zero to 100, where 100 indicates an absolute positive outlook, 50 indicates a neutral outlook, and zero indicates an absolute negative outlook.

Research firm Market Strategies International conducted 281 telephone interviews with executives at companies that do business internationally and have $50 million or more in annual revenue. Participants were executives, associate vice president and director level or above, with either primary responsibility or at least some influence over the company’s international business plans or strategies. This year’s survey occurred during a U.S. presidential election cycle between Nov. 14, 2016, and Jan. 24, 2017, when attention to business and economic issues is often greater than during a nonelection cycle. The margin of error on the total is 6.8% with a 95% confidence level.